ANSYS Reports Strong Revenue and Earnings Growth for the First

ANSYS Reports Strong Revenue and Earnings Growth for the First Quarter

Management Increases 2011 Guidance

PITTSBURGH, May 5, 2011 — (PRNewswire) — ANSYS, Inc. (NASDAQ: ANSS), today announced over-performance against its guidance in both revenue and diluted earnings per share for the first quarter of 2011. Total revenue increased by 16.2% over the first quarter of 2010. GAAP net income and diluted earnings per share increased 30.5% and 28.6%, respectively, over the first quarter of 2010, while non-GAAP net income and diluted earnings per share increased 23.1% and 21.3%, respectively. The growth in the first quarter was spread across all major geographic regions and among a broad array of industries.

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"ANSYS' first quarter results are an excellent start to 2011 and represent early momentum from the focus and investments in 2010," commented Jim Cashman, ANSYS President and CEO. "During the first quarter of 2011, all major metrics of the business showed continued improvement, highlighted by revenues and earnings that were above our guidance, a record deferred revenue balance of $236.4 million, and all time high cash flows from operations."

"We also saw improvement in the UK and North America markets over last quarter and, most notably, our Japan team delivered a very strong contribution to our first quarter results. We are extremely proud of their continued dedication and ongoing efforts in the face of such extraordinary circumstances. Supporting our Japanese employees and customers as they focus on rebuilding will be a new and important priority as we look into the remainder of 2011. Despite the various political turmoil and macroeconomic concerns, our diversified global reach, our resilient business model and our technological leadership continue to drive customer engagements. With the growing need for energy efficiency, stricter environmental and regulatory mandates, and ever-increasing consumer expectations, our customers are increasingly using simulation to enable innovation and value creation. These increasing business pressures, coupled with the dedication and efforts of our global team, have continued to enable us to deliver on our commitments," stated Mr. Cashman.

ANSYS' first quarter financial results are presented below. The non-GAAP results exclude the income statement effects of stock-based compensation and acquisition-related amortization of intangible assets. GAAP and non-GAAP results reflect:

Total GAAP and non-GAAP revenue of $158.0 million in the first quarter of 2011 as compared to total GAAP and non-GAAP revenue of $136.1 million in the first quarter of 2010;
A GAAP operating profit margin of 39.4% in the first quarter of 2011 as compared to 36.5% in the first quarter of 2010; a non-GAAP operating profit margin of 49.9% in the first quarter of 2011 as compared to 48.7% in the first quarter of 2010;
GAAP net income of $42.2 million in the first quarter of 2011 as compared to GAAP net income of $32.4 million in the first quarter of 2010; non-GAAP net income of $53.5 million in the first quarter of 2011 as compared to $43.5 million in the first quarter of 2010; and
GAAP diluted earnings per share of $0.45 in the first quarter of 2011 as compared to GAAP diluted earnings per share of $0.35 in the first quarter of 2010; non-GAAP diluted earnings per share of $0.57 in the first quarter of 2011 as compared to $0.47 in the first quarter of 2010.

The Company's GAAP results reflect stock-based compensation charges of approximately $5.1 million ($4.0 million after tax) or $0.04 diluted earnings per share for the first quarter of 2011.

The non-GAAP financial results highlighted above, and the non-GAAP financial outlook for 2011 discussed below, represent non-GAAP financial measures. Reconciliations of these measures to the appropriate GAAP measures for the three months ended March 31, 2011 and 2010, and for the 2011 financial outlook, are included in the condensed financial information included in this release.

During the first quarter of 2011, the Company repurchased 247,443 shares of stock at an average price of $51.34. The Company currently has approximately 1.1 million shares remaining in its authorized repurchase program.

Management's Remaining 2011 Financial Outlook

The Company has provided its 2011 revenue and earnings per share guidance below. The earnings per share guidance is provided on both a GAAP basis and a non-GAAP basis. Non-GAAP diluted earnings per share excludes charges for stock-based compensation and acquisition-related amortization of intangible assets.

Second Quarter and Fiscal Year 2011 Guidance

The Company currently expects the following for the quarter ending June 30, 2011:

Revenue in the range of $155 - $161 million
GAAP diluted earnings per share of $0.41 - $0.46
Non-GAAP diluted earnings per share of $0.54 - $0.57

The Company currently expects the following for the fiscal year ending December 31, 2011:

Revenue in the range of $645 - $665 million
GAAP diluted earnings per share of $1.81 - $1.91
Non-GAAP diluted earnings per share of $2.30 - $2.38

These statements are forward-looking and actual results may differ materially. Non-GAAP diluted earnings per share is a supplemental financial measure and should not be considered as a substitute for, or superior to, diluted earnings per share determined in accordance with GAAP.

Conference Call Information – Change in Format

ANSYS will hold a conference call at 10:30 a.m. Eastern Time on May 5, 2011 to discuss first quarter results. The Company is now providing its prepared remarks on the Company's Web site and as an exhibit in its Form 8-K in advance of the call to provide shareholders and analysts with additional time and detail for analyzing its results in preparation for the conference call. The prepared remarks will not be read on the call – only brief remarks will be made prior to the Q&A session.

To participate in the live conference call, dial 800-860-2442 (US), 866-605-3852 (Canada) or 412-858-4600 (Int'l). The call will be recorded and a replay will be available approximately one hour after the call ends. The replay will be available for ten days by dialing 877-344-7529 (US), or 412-317-0088 (Canada and Int'l) and entering the passcode 450231. The archived webcast can be accessed, along with other financial information, on ANSYS' web site at http://investors.ansys.com.

ANSYS, INC. AND SUBSIDIARIES Condensed Consolidated Balance Sheets (in thousands) (Unaudited)


	March 31, 2011	December 31, 2010


ASSETS:

Cash & short-term investments	$ 550,469	$ 472,934
Accounts receivable, net	71,049	76,604
Goodwill	1,035,342	1,035,083
Other intangibles, net	267,392	278,320
Other assets	254,108	263,935

Total assets	$2,178,360	$2,126,876



LIABILITIES & STOCKHOLDERS' EQUITY:

Deferred revenue	$226,426	$ 199,805
Long-term debt (including current portion)	154,177	159,525
Other liabilities	221,124	237,617
Stockholders' equity	1,576,633	1,529,929

Total liabilities & stockholders' equity	$ 2,178,360	$ 2,126,876

ANSYS, INC. AND SUBSIDIARIES Consolidated Statements of Income (in thousands, except per share data) (Unaudited)

	Three Months Ended

	March 31, 2011	March 31, 2010
Revenue:
Software licenses	$ 95,867	$ 81,586
Maintenance and service	62,180	54,467

Total revenue	158,047	136,053

Cost of sales:
Software licenses	2,894	2,609
Amortization	7,498	8,214
Maintenance and service	16,190	13,830
Total cost of sales	26,582	24,653

Gross profit	131,465	111,400


Operating expenses:
Selling, general and administrative	40,476	35,228
Research and development	24,698	22,587
Amortization	4,017	3,962
Total operating expenses	69,191	61,777

Operating income	62,274	49,623

Interest expense	(803)	(1,549)
Interest income	695	368
Other expense	(514)	(507)

Income before income tax provision	61,652	47,935

Income tax provision	19,411	15,566

Net income	$ 42,241	$ 32,369

Earnings per share – basic:
Basic earnings per share	$ 0.46	$ 0.36
Weighted average shares - basic	91,767	89,964

Earnings per share – diluted:
Diluted earnings per share	$ 0.45	$ 0.35
Weighted average shares - diluted	94,171	92,774

ANSYS, INC. AND SUBSIDIARIES Reconciliation of Non-GAAP Measures *(Unaudited)* *(in thousands, except percentages and per share data)*

	Three Months Ended

	March 31, 2011			March 31, 2010

	As		Non-GAAP	As		Non-GAAP
	Reported	Adjustments	Results	Reported	Adjustments	Results

Total revenue	$158,047		$158,047	$136,053		$136,053

Operating income	62,274	$16,662(1)	78,936	49,623	$16,651(3)	66,274

Operating profit margin	39.4%		49.9%	36.5%		48.7%

Net income	$ 42,241	$11,231(2)	$ 53,472	$ 32,369	$11,082(4)	$ 43,451

Earnings per share - diluted:
Diluted earnings per share	$ 0.45		$ 0.57	$ 0.35		$ 0.47
Weighted average shares - diluted	94,171		94,171	92,774		92,774


(1) Amount represents $11.5 million of amortization expense associated with intangible assets acquired in business acquisitions, including amounts primarily related to acquired software, customer list, trademarks and non-compete agreements, as well as a $5.1 million charge for stock-based compensation. (2) Amount represents the impact of the adjustments to operating income referred to in (1) above, adjusted for the related income tax impact of $5.4 million. (3) Amount represents $12.1 million of amortization expense associated with intangible assets acquired in business acquisitions, including amounts primarily related to acquired software, customer list, trademarks and non-compete agreements, as well as a $4.5 million charge for stock-based compensation. (4) Amount represents the impact of the adjustments to operating income referred to in (3) above, adjusted for the related income tax impact of $5.6 million.

ANSYS, INC. AND SUBSIDIARIES Reconciliation of Forward-Looking Guidance Quarter Ending June 30, 2011

	Diluted Earnings Per Share Range


U.S. GAAP guidance	$0.41 - $0.46
Adjustment to exclude acquisition–related amortization	$0.07 - $0.08
Adjustment to exclude stock–based compensation	$0.04 - $0.05

Non-GAAP guidance	$0.54 - $0.57

ANSYS, INC. AND SUBSIDIARIES Reconciliation of Forward-Looking Guidance Year Ending December 31, 2011

	Diluted Earnings Per Share Range


U.S. GAAP guidance	$1.81 - $1.91
Adjustment to exclude acquisition–related amortization	$0.30 - $0.31
Adjustment to exclude stock–based compensation	$0.17 - $0.18

Non-GAAP guidance	$2.30 - $2.38

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